Consumer Group: Direct-Carrier Billing Lacks Consumer Protections

Dec. 27, 2011

Consumers Union, the San Francisco-based consumer watchdog group that publishes Consumer Reports magazine, recently targeted direct-carrier billing for online purchases as a mobile payment method that lacks protections for consumers. The advocacy group urged top wireless carriers to strengthen their contracts to protect consumers in the event that their phone is lost or stolen or if a merchant makes a billing mistake or the customer is not satisfied with a purchase. "Consumers using mobile payments should get the same strong protections they currently enjoy when they make purchases with a credit card or debit card," said Michelle Jun, senior attorney for Consumers Union, the nonprofit advocacy arm of Consumer Reports. "But we found that consumer rights can vary widely between wireless carriers and the protections carriers claim to provide are often nowhere to be found in customer contracts." CU has set up a section of its Defend Your Dollars Website that summarizes which carriers provide what protections. The group has urged consumers who wish to purchase items using their phones to use a service linked to a credit or debit card, which carry consumer protections mandated by law.